Aneka Tambang IPO seen drawing warm response
Reuters Story - October 15, 1997 01:07
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By Gde Anugrah Arka
JAKARTA, Oct 15 (Reuters) - Indonesia's state-owned gold and
nickel miner PT Aneka Tambang is likely to shine out from the
general market gloom when it lists on the Jakarta Stock Exchange
next month, market analysts said on Wednesday.
They expected the listing to draw good support despite a
glum outlook for many of the company's corporate firms.
Even without President Suharto's call this week for bigger
pension fund participation on the local stock markets, which
should boost Tambang's issue, the offering should be a success,
they said.
"(It will be) fully subscribed. Even without the president's
urge. Why? Because it's a dollar earner," said Robert Allison,
head of sales with Asia Equity Jasereh brokerage.
Suharto on Monday urged pension funds and state-owned firms
to pursue a more active role on the local stock markets, which
have plunged recently due to turmoil in the currency market.
Current regulations allow Indonesia's state-owned pension
funds to invest only a small part of their huge stockpiles of
cash in stocks due to the market's volatile nature, analysts
said.
Tambang said it planned to offer up to 430 million shares to
the public for the November listing, but details of the IPO,
including the offer price, were not yet available.
Aneka Tambang posted a net profit of 24 billion rupiah in
the first half of 1997 against 22.6 billion rupiah in the same
period last year.
Analysts also said investors were likely to take a lead from
the recent sharp rises in share prices of nickel miner PT
International Nickel Indonesia (Inco) and tin miner PT
Tambang Timah , which were helped by their dollar
earnings.
"Many players are amazed at seeing how another nickel miner
Inco staged such a spectacular rise amid the market turmoil,"
said Edi Widjoyo, mining analyst with Mashill Jaya Securities.
"The Inco factor is likely to be among the key factors
boosting Aneka Tambang's IPO," he said. Inco Indonesia is owned
59 percent by Inco Ltd of Canada .
The share price of Inco almost quadrupled recently, closing
at 8,700 rupiah on Tuesday against a year-low 2,300 in late
August and a year-high of 9,000 rupiah last Friday.
State-controlled Timah, listed in London , also
managed strong gains, closing at 5,375 rupiah on Tuesday against
a year-low of 3,000 rupiah in late July.
"Aneka Tambang has sound fundamentals, low debt and earnings
in dollars, but its size is smaller than Timah which also has a
strong balance sheet," Mashill's Widjojo said.
"As long as the PE (price-earnings) ratio is made more
attractive than Timah, the IPO should be a success despite the
gloomy outlook for many corporates," he said.
Standard & Poor's Corp said last Friday it had lowered its
long-term foreign currency debt ratings on several Indonesian
blue chips following the downgrade in the country's foreign and
local currency ratings.
S&P said the downgrading reflected among other things a
steep rise in corporate external indebtedness and the setback to
inflation performance caused by the rupiah's sharp fall against
the dollar.
The rupiah crashed to a historic low of 3,845 against the
dollar early last week but later improved on central bank
intervention and the government's decision last week to seek
assistance from the International Monetary Fund.
The rupiah was trading at around 3,490 rupiah against the
dollar in Wednesday morning trading.
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